Just a third of people who had been unemployed for more than 27 weeks between 2008 and 2012 were employed 15 months later, according to a new paper from the Brookings Institution. Worse, of those who were lucky enough to find a job, just 11 percent had steady, full-time work.
On the other hand, two-thirds weren’t employed, and 34 percent had given up looking altogether. The paper finds, “Longer durations of unemployment are associated with a lower transition rate into employment,” and “the long-term unemployed frequently are displaced soon after they gain reemployment,” meaning that its harder for them to find jobs and to stay in them once they do.
In fact, the paper finds that the long-term unemployed find jobs at less than half the rate of those who experience very short unemployment spells. While the rate at which unemployed people are able to find employment has risen for everyone no matter how long they were out of work, “it has barely increased for those unemployed longer than a year,” it notes. Last year, less than 10 percent of people who had been out of work for more than a year got a job in an average month.
And it’s not likely because the long-term unemployed are less hirable. Given their characteristics, their job finding rate should be about 25 percent, but it “is consistently below that rate even in periods of a relatively strong job market,” the paper finds. Instead, it’s likely that they face bias from prospective employers, something that has been shown to disproportionately effect the long-term unemployed in different studies.
It’s not just that the long-term unemployed take longer to find a job. They are also more likely to give up altogether — which could possibly be driven by the fact that it’s so hard for them to find work in the first place. “[T]he long-term unemployed tend to have a higher rate of labor force exit than the short-term unemployed,” the authors write, which means they drop out of the pool who either have a job or are searching for one.
These factors mean that the long-term unemployment rate is much higher than it has been after past recessions. “Despite declining over the last 4 years, the share of the unemployed who have been out of work for more than 6 months still exceeds its previous peak reached in 1981-82, and is well above its average in the last recovery,” they write. Yet short-term unemployment is much more on track with past recoveries.
And the improving economy doesn’t seem to be reaching those who have been out of work for long periods. Even in the 13 states with the lowest unemployment rates as of October, the long-term unemployment rate is still high and their prospects of finding a job are just as good (or bad) in states with higher rates of unemployment. “These findings suggest that the long-term unemployed with continue to encounter difficulty finding employment even if the unemployment rate continues to fall,” the authors warn, “although a stronger economy would undoubtedly raise the prospects of the long-term unemployed.” This is why they argue that “a concerted effort will be needed to raise the employment prospects of the long-term unemployed.”
The problems won’t stop plaguing these workers even if they are lucky enough to eventually find steady employment. They’ll make lower wages than they would have if they weren’t unemployed or even if they had just gone a shorter time without a job. Once they get back to work, they’ll make 67 percent less than they would have without an unemployment spell, and their incomes will be 32 percent less a decade later.
It’s also worth remembering that while these workers face daunting odds in getting back to work, they are also going without benefits. Congress let them lapse at the end of last year and Republican filibusters have prevented them from being restored since. That means that more than 2 million people are unemployed and going without checks.